By the Unemployment and Health Policy Task Force

The Commonwealth government has outlined a clear goal of driving unemployment down in order to stimulate economic growth. However, maximising employment is not a simple question of labour market mechanics. Just as 2020 demonstrated that health and economic crises are intertwined, 2021 will also highlight that a healthy population is the driving force behind optimising economic recovery.  

It is widely understood that unemployment can result in poor health, dubbed the ‘causation’ mechanism. For example, unemployment results in a two-fold increase in  the risk of depression, and higher rates of chronic diseases including cardiovascular disease and diabetes.

But emerging evidence suggests a bidirectional relationship. Not only does unemployment directly affect health, but there is a simultaneous ‘health selection’ mechanism at play. Those with mental or physical health issues are at higher risk of becoming unemployed, and, once unemployed, have a lower likelihood of re-employment. 

A chronic disease might result in worse job performance or reliability, and an increase in sick-days. This hypothetical employee would be at high risk of redundancy through no fault of their own. This is a particular issue for those with mental health conditions. Further, someone who is unemployed might be less likely to receive their influenza vaccine; if they were then to get the flu, the long-term health complications associated with the disease could interfere with applying for jobs or maintaining recent reemployment.

Selection and causation mechanisms are mutually reinforcing processes that shape people’s employment and health trajectories over time. It is important to target policy to address both mechanisms.

Adequate unemployment support is key to not only to improving the health of unemployed people, but also to getting them back into work. An individual’s health is determined by the environmental and cultural conditions they are exposed to. Termed the ‘social determinants of health’, factors like housing, food security, access to basic amenities, and exposure to stressors, directly predict adverse health outcomes. 

In Australia, JobSeeker remains below the poverty line. This is inadequate for unemployed people to stay healthy. People who are unemployed are not able to fund a basic quality of life, are exposed to a great deal of stress, and are at risk of poor health. 

Adequate welfare payments tackle many of the upstream issues that predispose unemployed people to poor health. Raising JobSeeker to above the poverty line would better equip our JobSeekers to secure and maintain employment by improving their health. It would also be beneficial for both individuals and the country: increased welfare spending improves health outcomes on a population level. 

The challenges of a meagre JobSeeker payment bleeds into accessing and receiving healthcare. People without a job – a group who typically need health services more often – are 3.6 times less likely than employed people to go to hospital when they need to. A major barrier is cost. 

The costs of accessing healthcare go beyond simply medical treatments themselves – everything from parking to public transport costs are a financial drain. Expanding supports such as reimbursements or subsidies for these incidental costs, encourage individuals to seek out medical services when they need.

Cheap or free access to a broader range of preventative medicine, such as influenza vaccinations, could also reduce the burden on healthcare systems and help people back into work. 

Food insecurity is a challenge facing many Australian households. Some 4-13% of Australian households experience food insecurity, and this can translate to poor physical and mental health outcomes, which is associated with greater risk of unemployment. 
School-aged children are more affected by food insecurity as it affects their crucial developmental years. Governments can alleviate the impacts of food poverty through supplying free health breakfasts in schools, particularly in low socioeconomic areas. These programs will allow for improvements in physical and cognitive development, leading to improved employment outcomes later in life. 

Strategies to improve health and employment opportunities can begin in early childhood. For every dollar invested in early childhood, Australia will receive $2 in benefits back over a child’s life. 

We could mandate two years of preschool education instead of one. Currently, only two thirds of children are accessing preschool education for 2 years, generally those of higher socioeconomic status. Two years of preschool education will allow all children, irrespective of socioeconomic status, to optimise their development from early childhood.

A lower unemployment rate has significant benefits for public health. But the best approach involves action from both sides: creating jobs to improve health, but also, the oft-forgotten improving health to ensure people can take up those jobs.